Greek Election Surprise Rejects ‘Barbarism’ of Bailout Austerity

Alexis Tsipras, head of the Syriza party. Photographer: Simon Dawson/Bloomberg

May 7 (Bloomberg) -- Alexis Tsipras became the surprise
package of the Greek election by telling Angela Merkel to get
lost.

“The people of Europe can no longer be reconciled with the
bailouts of barbarism,” Tsipras, 37, said on state-run NET TV
late yesterday after his Syriza party unexpectedly came second
in the country’s election. “European leaders, and especially
Ms. Merkel, should realize that her policies have undergone a
crushing defeat.”

Tsipras’s calls to tax the rich, delay debt repayments and
cut defense spending struck a chord with voters angry at
austerity measures imposed by the European Union and the
International Monetary Fund in return for bailouts. As far as
euro membership is concerned, Tsipras told voters that a Greek
exit would put the currency itself in jeopardy and they
shouldn’t feel “blackmailed” into more austerity.

The result put Syriza ahead of the Socialist Pasok party,
potentially derailing efforts to implement the terms of the
country’s financial lifeline. Syriza, which means Coalition of
the Radical Left, won 16 percent of the vote, projections
showed. That exceeded the 13 percent won by Pasok, one of the
two pillars of the political establishment since 1974. New
Democracy, led by Antonis Samaras, topped the poll with 20
percent.

The result, the best since the party was founded in 2004,
puts Tsipras in a position to try and form a government should
New Democracy fail to put a coalition together in the first
round of talks.

Greek Rivalries

What may stop Tsipras from taking power are the traditional
rivalries among the Greek left.

“They have already achieved what they could achieve,”
said Wolfango Piccoli, an analyst at Eurasia Group in London.
“They have become the second-largest party but nobody will
strike a deal with them. They can only make their voice heard
more by the Greek public thanks to a larger presence in
parliament but not much more than that.”

Before yesterday’s election result, Tsipras had proposed
joining forces with the Communist Party of Greece, the oldest
parliamentary party in the country, and the Democratic Left,
which won 6 percent of the vote, to form a coalition.

Both parties have rejected the overture, with Communist
Party chief Aleka Papariga repeating her refusal last night.

Tsipras suggested such a combination would be able to draw
some informal support from other anti-bailout parties, such as
the Independent Greeks, led by former New Democracy lawmaker
Panos Kammenos, which yesterday scored 10 percent.

Anti-Bailout

“If we as the left, despite the differences, submit our
proposal and get five votes of support or tolerance from
Kammenos we won’t reject them,” Tsipras said in an interview on
April 25. “We must stop the bailout memorandum,” he said.

Syriza garnered 4.6 percent of the vote in Greece’s last
elections in 2009 and 13 seats. Polls during the election put
their support between 7 percent and 13 percent.

Greek voters flocked to anti-bailout parties, official
results showed yesterday, as the country balks at an
unemployment rate of almost 22 percent. That’s throwing doubt on
whether, New Democracy and Pasok, can form a coalition to
implement spending cuts to ensure the flow of bailout funds.

Pasok party leader Evangelos Venizelos, the former finance
minister who negotiated the second rescue packages, said the
electorate had provided no clear mandate and called on a pro-European national unity government to be formed.

Austerity Rejection

The election was the first since the country helped trigger
the European debt crisis and comes as voters across the region
turn their backs on austerity measures backed by Merkel. In
France, Francois Hollande defeated President Nicolas Sarkozy
yesterday and in Germany Merkel’s party suffered its worst
result in more than a half a century in the northern state of
Schleswig-Holstein.

Bowing to German austerity, Greece agreed to impose pension
and wage cuts in return for two international rescues worth 240
billion euros ($312 billion). Greece must continue spending cuts
to keep disbursements flowing. Failure to do that may determine
whether the country has a future in the euro area.

For Tsipras, a civil engineer by training, the question of
Greece’s continuing membership of the euro is overstated because
its exit could mean an end to the currency itself.

“The crisis isn’t just Greek, it’s European,” he said on
April 22. “There will either be a collective, sustainable and
fair European solution to the public debt issue or it will
collectively fall apart. The Greek people should understand that
this blackmail is false and they must stop blackmailing them
with a supposed exit of just Greece without the destruction of
the euro.”